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I wrote last month about the two companies for high-potential kids. One reported outsized quarterly earnings growth. On February 28, 2022, Spin Master (TSX: TOY) reported record financial results for the fourth quarter and full year 2021. The other company, Corus Entertainmentcontinues in 2022. However, it has not yet communicated its results for the same periods.

Impressive growth

Max Rangel, President and Global CEO of Spin Master, said, “We saw very impressive growth in 2021 across our three Creation Centers and reinforced our commitment to creating magical play experiences for children and their children. families through innovative toys, engaging entertainment and creative digital games. .”

Rangel adds, “We have built a solid foundation for continued long-term growth and as we enter 2022, we are focused on developing the full potential of digital toys, entertainment and games.”

This year, however, could be more difficult for the toy industry in general due to geopolitical tensions. Still, growth investors should keep TOY on their watchlists, given the company’s superb business performance amid 2021’s supply chain issues.

Financial Highlights

The $4.8 billion global children’s entertainment company creates exceptional play experiences. In the fourth quarter of 2021, Spin Master’s net income increased 8,733.3% to $26.5 million compared to the fourth quarter of 2020. For the full year, year-over-year growth the other was 336.5%.

Mark Segal, Spin Master’s CFO, said, “In the fourth quarter, we maintained the positive momentum we’ve built throughout the year, combining organizational discipline, financial focus and operational efficiency to exceed our expectations. The company also hit several milestones in 2021.

Segal said the 30% increase in total revenue helped Spin Master surpass US$2 billion for the first time. In addition to the growth of more than 20% in product sales, the adjusted EBITDA margin exceeded 20%, another first. Due to management’s focus on working capital, the company had over US$1 billion of cash available at the end of 2021.

Spin Master’s distribution network in over 100 countries is a competitive advantage. Its award-winning brands include PAW Patrol, Bakugan, Kinetic Sand, Air Hogs, and Hatchimals, among others. The company is also the worldwide toy licensee for other popular properties.

Business Outlook

Spin Master will continue to leverage its portfolio of innovative products and brands. According to Rangel, its cross-platform entertainment franchises and open-ended digital games also reduce reliance on physical objects. He adds that the positive mix effect of digital games and entertainment has allowed Spin Master to offset pressure on toy margins amid supply chain disruptions.

Additionally, management is confident that the launch of Spin Master Ventures (SMV) will help accelerate the growth of each of its three creative hubs. Management will capitalize on the rapidly evolving children’s entertainment space. SMV will make strategic minority investments in startups with a view to changing the entrepreneurial game with promising ideas.

Partnership generator

Spin Master wants to expand relationships, networks and knowledge to become the ultimate partnership generator. SMV is expected to strengthen its leading position in the children’s entertainment space. At $46.96 per share, the one-year price return is $61.60. If you invest today, the market analysts’ 12-month average price target is $58.11, a potential return of 23.7%.